The Trustee for the K.J. Family Trust & The Trustee for the W.J. Family Trust T/A Taylor Family Produce
[2023] FWCFB 166
•21 SEPTEMBER 2023
| [2023] FWCFB 166 [Note: A copy of the zombie agreement to which this decision relates (AG520289) is available on our website.] |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
Sch. 3A, Item 26A(4) - Application to extend default period for Division 2B State employment agreements
The Trustee for the K.J. Family Trust & The Trustee for the W.J. Family Trust T/A Taylor Family Produce
(AG2023/1749)
TAYLOR FAMILY PRODUCE CERTIFIED AGREEMENT
[AG520289]
| Agricultural industry | |
| DEPUTY PRESIDENT WRIGHT | SYDNEY, 21 SEPTEMBER 2023 |
Application to extend the default period for the Taylor Family Trust Certified Agreement
The Trustee for the K.J. Family Trust & The Trustee for the W.J. Family Trust t/a Taylor Family Produce ABN 48 893 471 448 (Applicant) has applied under item 26A(4) of Schedule 3A to the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Transitional Act) to extend the default period for the Taylor Family Trust Certified Agreement (Agreement) to 10 August 2024.
The Agreementwas approved on 23 December 2009 under s.156 of the Industrial Relations Act 1999 (Qld). It is a Division 2B State employment agreement for the purposes of item 5 of Schedule 3A of the Transitional Act. It is also a collective agreement-based transitional instrument for the purposes of the Transitional Act. It has not terminated and so continues in operation.
The Transitional Act was amended by the Fair Work Legislation Amendment (Secure Jobs, Better Pay)Act 2022 (Amendment Act) to provide for the automatic termination of all remaining transitional instruments. The Amendment Act refers to transitional instruments as ‘zombie’ agreements. Pursuant to items 26A(1) and (2) of Schedule 3A to the Transitional Act, Division 2B State employment agreements will terminate on 6 December 2023 unless extended by the Commission.
Item 26A is relevantly in identical terms to item 20A of Sch 3 to the Transitional Act, which is concerned with the automatic sunsetting of, and applications for, extension of the default period for agreement-based transitional instruments. The main features of item 20A of Sch 3 are described in detail in the Full Bench decision in Suncoast Scaffold Pty Ltd[1], and that analysis applies equally to item 26A of Sch 3A. It is not necessary to repeat it here.
Under subitem (6) of item 26A, upon application, the Commission is required to extend the default period for an agreement-based transitional instrument for a period of no more than four years if the Commission is satisfied that:
(a) Subitem (7), (8) or (9) applies and it is otherwise appropriate in the circumstances to do so; or
(b) it is reasonable in the circumstances to do so.
The application is advanced under subitem 6(b) on the basis that it is reasonable in the circumstances to extend the default period to 10 August 2024 for three reasons. First, the unique circumstances of the Applicant and its business. Second, it proposes to replace the Agreement with an enterprise agreement and needs time to do so. Third, the employees support the extension as the impact of terminating the agreement mid-way through the growing season would be unfair.
The Applicant’s case
The Applicant provided a statement of Raymon Taylor, its Managing Director, and written submissions.
Mr Taylor describes the Applicant as a multi-generational, family-owned farming business with roots dating back to 1914. The business is located primarily in Queensland and New South Wales, specialising in growing various vegetables such as lettuce, Chinese cabbage, celery, cauliflower, and silverbeet. The operations vary according to seasonal conditions. For example, planting and harvesting cycles occur at various times throughout the year across the separate locations. The farms operate year-round and employ approximately 15 full-time, 5 part-time, 19 casual staff, and up to 60 seasonal workers during peak harvesting periods. There is a seasonal gap during June, July, and August, leading to approximately six weeks of reduced work. Employees bank extra hours during peak seasons to take time off during periods of reduced work in June, July, and August.
The Applicant seeks an extension of the Agreement to allow it sufficient time to enter into an enterprise agreement to replace the Agreement. An extension to 10 August 2024 is sought and the Applicant asserts this will avoid disrupting operations during the negotiation and approval of a replacement enterprise agreement. The extension sought is until after the end of the growing season in June 2024. The Applicant submits that the negotiation and transition to a new enterprise agreement is expected to be complex, as multiple modern awards cover various aspects of the business, including clerical work, horticulture, transport, and equipment maintenance.
The bargaining process commenced on 31 August 2023, and the Applicant has appointed an employment lawyer as its bargaining representative. A bargaining meeting with employees is scheduled to occur before the end of September 2023.
Consideration
In Suncoast Scaffolding Pty Ltd the Full Bench described the ‘reasonable’ criterion in applications to extend default periods as follows[2]:
[17] Subitem (6)(b) of item 20A constitutes an independent pathway to the grant of an extension. The ‘reasonable’ criterion in the subitem should, in our view, be applied in accordance with the ordinary meaning of the word –that is, ‘agreeable to reason or sound judgment’. Reasonableness must be assessed by reference to the ‘circumstances’ of the case, that is, the relevant matters and conditions accompanying the case. Again, a broad evaluative judgment is required to be made.
The Commission is required to grant an extension to the default period if the conditions of subitem 6(b) are satisfied. However, there is a discretion as to the length of the extension, subject to the limitation that the extension cannot be for more than four years.
The circumstances in this matter are similar to the circumstances considered in Application by Tinmarl Pty Ltd as trustee for R & M Patane Family Trust trading as North Queensland Golden Fruit[3] where the Full Bench was satisfied that an extension of the default period was reasonable to ensure that applicant could make arrangements to secure seasonal labour for the upcoming mango harvesting season whilst also accommodating negotiations for a replacement agreement. There is some difference, because in that matter bargaining for a replacement agreement was complicated by the fact that the seasonal workers were Pacific Islanders who were engaged under a migrant labour scheme and were not available to negotiate a replacement agreement prior to the harvest season.
In this matter we are of the view that, for the reasons advanced by the Applicant, it would be reasonable to extend the default period to allow a replacement agreement to be negotiated. The Applicant’s operations do involve a level of complexity with employees working across the coverage of a number of modern awards. The considerable number of seasonal workers who are covered by the Agreement is also a factor favouring an extension. Whilst it was conceivable that negotiations could have occurred earlier this year, the June, July and August off season meant those seasonal workers may not have been available to finalise a replacement agreement.
We do not believe that a 9-month extension is necessary to finalise a replacement enterprise agreement. Indeed, to accommodate the seasonal nature of the work, a replacement agreement should be finalised before the slow period commencing in June 2024. This will ensure that seasonal workers are available to participate and vote for the replacement agreement. We further note that the appointment of a lawyer practicing in employment law may assist in finalising bargaining in the time available. The Commission is also available to assist in bargaining pursuant to s.240 of the Fair Work Act 2009 should this be necessary. In the circumstances we consider an extension of 6 months to 7 May 2024 is appropriate.
Accordingly, the default period for the Agreement is extended until 7 May 2024. An order to give effect to this decision will be published separately.
The Agreement is published, in accordance with item 20A(10A)(c) of Sch 3 to the Transitional Act, as an annexure to this decision.
DEPUTY PRESIDENT
[1] [2023] FWCFB 105
[2] id
[3] [2023] FWCFB 124
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